costs

Could 2018 End Up Being a Year of Improved Health Insurance Market Stability? Here are Five Reasons It Could Be the Case.

With healthcare seemingly out of the political crosshairs for the moment and any tectonic shifts emanating from a new Amazon/Berkshire Hathaway/J.P. Morgan Chase superpower health entity a ways down the road, employers may get to experience some at least temporary market stability in the way of more choices, more consistent rates, less volatile renewals, and more opportunities to innovate (e.g. SharedFunding).

Employers have grounds for hope, at least for the next year or so.

Here are five (5) reasons that may lead to at least some temporary stability and have positive impact on cost and selection in the group market:

  1. The total number of people insured is holding steady or possibly even increasing despite the repeal of the individual mandate.
  2. Interest and energy in employer sponsored plans is up. More employers are offering health coverage. Many are also trying to improve their health coverage in order to compete for and retain talent in a more robust job market and a stronger economy.
  3. Much of the market activity for both insurance carriers and healthcare providers is geared toward gaining scale while building a better mousetrap (eg. Aetna/CVS, Unitedhealthcare and other carriers acquiring providers, etc). Strategic M&A activity is expected to continue.
  4. More states are experimenting by exercising the state waiver option (more info here and here). While tinkering with the individual market and Medicaid will get most of the headlines, more control on the state level should spawn more innovation and new options in the group market especially for small and mid-size employers.
  5. Health systems are now focused on vertical integration and improving their overall value proposition. They’re jockeying for market position and attempting to win over patients and payors alike.

 

 

Health Coverage By the Numbers (vol 2): The Cost of Coverage and Employer Contributions

Job-based health insurance is still far and away the largest single source of health care coverage in the U.S. As we continue to work on behalf of clients to drive new and better ways to stem the tide of health care costs, here are some key stats from 2017 to ponder:

1.)  Average annual premium nationally for single coverage — .$6,690 (or $557 per month)

2.)  Average annual premium nationally for family coverage — .$18,764 (or $1,564 per month)

3.)  Generally speaking, most employers cover at least 50% of the employee’s cost of premium. Nationally, employers cover on average 81% of the cost of single (employee only) premium.

4.)  Not all employers contribute to family coverage. Employers that do contribute to family coverage, cover on average 69% of the cost to cover dependents.

Source: Kaiser Family Foundation

Pharmacy Coupons and Insurance Companies Making Adjustments

This is an example of one Ohio company adjusting how they administer coupons people use at the pharmacyThe program helps make sure members’ out-of-pocket cost for prescription drugs are properly applied to deductibles and maximum out-of-pocket amounts.

The benefit of the coupon is easy to grasp.  Someone on an expensive brand medication can obtain it at low or no cost.

The problem can be that the carrier processes it as a paid claim and the member never pays what the plan requires.  There are reasons both employers and carriers want real out of pocket to be met by the member.

The carriers now are adjusting and working on ensuring that the member is not given credit or given a reimbursement for something they never paid for personally.  Members can use the coupons, but the carrier will credit only what the member actually paid.

This seems like a reasonable solution.  It will likely become a normal way coupons are processed.

Health FSA Limit Will Increase for 2018

The ACA imposes a maximum dollar limit on employee contributions to health flexible spending accounts (FSAs).  Although the ACA set this limit at $2,500, the limit is indexed for cost-of-living adjustments each year.  On Oct. 19, 2017, the IRS announced that, for taxable years beginning in 2018, the dollar limit on employees’ salary reduction contributions to a health FSA will increase to $2,650.


Employers may continue to impose their own dollar limits on employee contributions to health FSAs, as long as the employer’s limit does not exceed the ACA’s maximum limit in effect for the plan year.  For example, an employer may decide to continue limiting employee health FSA contributions for the 2018 plan year to $2,500.


Go here for more information.

Health FSA Limit Will Increase for 2018 10-19-17

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